Wealthy Virginia among least generous on Medicaid

Virginia is the wealthiest state to say no to expanding health insurance for the poor while the benefits it offers through its Medicaid program are lower than all but a handful of states.

Low-income parents in Newport News who earn more than $5,305 a year, about two-thirds the sum a minimum wage worker holding down a 20-hour-a-week job earns, make too much money to qualify for Medicaid in Virginia.

There are only a few places in the United States where people that poor can't get Medicaid, and they all have costs of living well below Hampton Roads, a Daily Press review of states' Medicaid manuals shows.

Even some of the poorest states offer more of the poor help with health care than Virginia. Mississippi, where the median income is less than two-thirds of Virginia's, has more generous Medicaid eligibility standards.

Virginians with disabilities also face high barriers for coverage. In Virginia, a person who is blind, wheelchair-bound or suffering from mental illness and earning more than $9,337 a year — about what a 25-hour-a-week job paying minimum wage yields — makes too much for Medicaid. Only Idaho and Georgia have lower caps.

"Virginia ranks near the bottom of the barrel," said Jill Hanken, a lawyer with the Virginia Poverty Law Center who specializes in health care issues.

That reflects the state's long-standing policy and the differing health needs and financing in other states, said Del. John O'Bannon, R-Henrico, the point person on health issues for the House of Delegates Republican caucus. House Republicans oppose expanding the system without significant reforms.

Medicaid expansion to cover parents was an easy decision for Maryland, since it already covered them with Medicaid's standard 50-50 split with Washington, O'Bannon said. Expansion means the federal government covers 100 percent of the cost of their care through 2016. The state share will gradually grow to a maximum of 10 percent in 2022.

The political and financial equation worked differently in North Carolina, where the legislature, like Virginia's, is dominated by conservatives who object to the Affordable Care Act, and where Washington was already picking up 67 percent of its Medicaid bill. North Carolina is not expanding Medicaid.

Virginia's cap on parents is meant to direct Medicaid mainly to those receiving welfare, O'Bannon said.

"We've tried to do the best we can by folks while dealing with the fact that we have only limited resources," he said.

House Republicans say they're appalled by Gov. Terry McAuliffe's insistence that the next state budget address coverage for Virginians with incomes below the poverty line. They say the budget's not the place to consider an expansion that most object to on the grounds of cost.

So far, Virginia has balked at accepting federal money to expand Medicaid, as 25 states have. The House of Delegates has balked, too, at a state Senate alternative that would set up a private option to simply expanding Medicaid.

In lieu of using $1.7 billion a year of Obamacare taxes that Virginians pay to fund the state Senate plan, or accepting some $2 billion in federal money to simply expand Medicaid, the House boosted payments to hospitals over the next two years by $118 million and added $6 million to support free clinics.

"It's not everything you might wish for, but I think it is probably enough," O'Bannon said. He said he believes the state's current safety net of free clinics and charity care serves the uninsured adequately.

The Senate's alternative to Medicaid expansion would cover about 195,000 Virginians living below the poverty line.

It would mean that a single parent with one child earning up to $15,730 could get health insurance coverage. That's the income a person working full time at $7.50 an hour makes. A health insurance policy now would cost that man or woman about $4,200.

Medicaid expansion as set up by the Affordable Care Act would cover more people. Its cut-off is 138 percent of the poverty line. Under the Senate alternative, the roughly 200,000 people with incomes above the poverty line but below the 138 percent cap would buy coverage through the act's insurance exchange, with the help of large federal subsidies.

The Senate plan would mean a person with disabilities earning $11,670 could get Medicaid. That's what a minimum wage employee working 30 hours a week makes.

Without the Senate plan, that person's only choice would be to go without insurance or to pay as much as $7,500 a year for coverage — coverage that requires additional out-of-pocket spending that could reach $6,350 a year.

The Senate proposal would mean that a person earning $12,000 a year could pay up to about $250 a year in premiums, because of the federal subsidy. Out-of-pocket spending would be capped at $2,250. If that person lived in West Virginia, where the median income is about two-thirds of Virginia's, that state's newly expanded Medicaid would provide insurance at no cost to him or her.